George Smith Partners' Mozer

The credit crunch has taken its toll on the retail sector. Sales are lagging and chain stores are cutting back their expansion plans. At the same time, shopping-center owners are taking part in fewer transactions, and it’s taking longer to get developments done. So how is all of this impacting lending in the sector? Well, it has taken a toll on getting these deals done, but maybe not as dramatically as one might expect, according to Gary Mozer, a principal and managing director at Los Angeles-based George Smith Partners. But the climate has definitely changed, he points out.

GlobeSt.com: How is the economy impacting retail financing?

Mozer: You can still get deals financed. I’m not saying it’s easy, but there is still financing out there. Is it as aggressive as it used to be? No. You can’t get a 95% non-recourse construction loan, but you can still get some recourse. And they’re underwriting the take out, which is more of a 70% or 75% loan to value instead of an 80% to 90%. People are saying, “How am I going to pay if off?” Things are getting done, but most of my retail clients are telling me the tenants aren’t signing up as fast.